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Written Answers. - Action Against Crime.

Wednesday, 12 June 1996

Dáil Éireann Debate
Vol. 466 No. 7

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 62. Mr. Callely Information on Ivor Callely Zoom on Ivor Callely  asked the Minister for Finance Information on Ruairí Quinn Zoom on Ruairí Quinn  his views on whether the Revenue authorities have failed to use their powers to target crime and drug barons; and if he will make a statement on the matter. [12213/96]

Minister for Finance (Mr. Quinn): Information on Ruairí Quinn Zoom on Ruairí Quinn Action to deal with criminals is primarily a matter for the gardaí. The Revenue [1882] Commissioners do, however, have an important part to play within their overall remit of assessing and collecting taxes and implementing import and export controls. I am satisfied, on the basis of my discussions with, and assurances from, the Commissioners that they are using their powers as best they can in the areas referred to by the Deputy.

The primary role of the Revenue Commissioners in combating drugs trafficking is played by the Customs Service, which is responsible for deterring and preventing smuggling of illicit drugs. The Revenue Commissioners have devoted very considerable resources to this area and, in particular, they set up the Customs National Drugs Team in 1992, with specific responsibility for detecting and preventing drug smuggling. Since 1993 over 50 people detected by Customs smuggling drugs at ports and airports have been detained and transferred to Garda custody. So far, there have been convictions in 23 cases, with jail sentences ranging from three months to ten years, being imposed. Some cases have yet to be heard, while sentencing is due in further cases. There have also been prosecutions under Customs legislation for other illegal activities.

As regards taxation, section 19 of the Finance Act, 1983, allows the Revenue to bring unexplained profits, whether derived from illegal activities or otherwise, into charge to income tax as “miscellaneous income”. The challenging of an unexplained build-up of capital has traditionally been the route used by Revenue's Investigation Branch in tackling many of the serious tax evasion cases. Section 19 has been brought into play on occasions where no satisfactory explanation was offered by a taxpayer as to the source of the capital. A number of those cases concern persons suspected of being involved in criminal activities such as drug trafficking.

To successfully apply this section, however, evidence of ownership of assets or of lifestyle has to be available. Where criminals are concerned such [1883] evidence is frequently very difficult to obtain, as these people tend to distance themselves from their assets, and properties or bank accounts with which they may be associated will not necessarily appear in their names. While Revenue will use their powers to investigate alleged ownership of assets they would frequently be dependent on the Garda to provide information or evidence of asset ownership which will have been derived from Garda investigations into the underlying criminal activity including drug trafficking. The Garda is the nominated authority for disclosure by financial institutions of suspicions of money laundering under the Criminal Justice Act 1994 and will also have the right to serve Orders under section 63 of that Act on financial institutions for further information as regards bank deposits of this kind. Revenue have assured me that they are committed to following up all cases where they receive information from the Garda and will deploy the necessary resources for this purpose.

The fact that Revenue have the facility to tax certain profits under section 19 does not make it any easier to prosecute and obtain a conviction in cases of offenders detected as having unexplained asset accumulation. The burden of proof on the authorities will be the same as for any other criminal prosecution. Where evidence is available that would support a criminal prosecution for tax evasion, Revenue have indicated that they will do everything possible to advance such a prosecution.


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